On June 11, 2025, the Ministry of Power has issued draft amendments (“Draft Amendments”) to the Electricity Rules, 2005 (“Rules”) under which changes to Rule 18 of the Rules relating to energy storage systems (“ESSs”) are sought to be made.
Under the current form of the Rules, an ESS may be owned developed, owned, leased or operated by a generating company, a transmission licensee or a distribution licensee, a system operator or an ESS service provider. However, under the Draft Amendments, consumers are also permitted to develop, own, lease and operate ESSs.
Although the amendments may be small, they may impact models for energy delivery and infrastructure investment. Consumers may now have a choice on whether to purchase power from hybrid systems with inbuilt ESS or from an independent ESS service provider or develop its own ESS. For commercial and industrial consumers with large energy needs a captive ESS may offer an interesting proposition and reduce dependence on generating companies.
